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At the IDB, we believe that together we can go farther. Our partnership network is making positive differences in Latin America and the Caribbean every day, and this blog is our channel for telling that story. Stay tuned for literature on partnership perspectives, stories from the field, changing trends, outlooks for development and the region, information on ways and opportunities to partner, and more. Thanks for stopping by.

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How Does Business Measure Up?

By and - May 21 2015

How Does Business Measure Up_Photo
When it comes evaluating businesses, how do we know if a company measures up? In an age where we can track everything from our web traffic to our daily footsteps, and where measurement is as easy as checking your analytics page or tapping a plastic band on your wrist, the least we can say is that in development, measuring is not just important—but expected. No, required. Yet in shared value partnerships, where collaborators jointly create cutting-edge development solutions that uplift all actors involved, this seemingly basic, seemingly instant step remains the greatest challenge.

This was a hot topic at the 2013 CSR Innolabs, an event held in Colombia by the Inter-American Development Bank (IDB), Forética’s technical secretariat, and a group of leading multinational, multi-sector companies who have stood apart as pioneers in corporate social responsibility (CSR). Among them ACCIONA, CEMEX, PepsiCo and SABMiller, these organizations had come together to share CSR methodologies and experiences with the end goal of fostering more innovative, competitive, and sustainable models in Latin America and the Caribbean (LAC).

At the Colombia session, attending business leaders lamented that the challenge doesn’t lie only in measurement. If measuring impact is hard, correctly interpreting impact is harder still. There is clear consensus on the critical importance of measurement, they agreed, as it is a proven vehicle for identifying project management risks and opportunities, improving communication with stakeholders, understanding local communities, learning, and innovating. But why then has it remained a real challenge to do so in an efficient, effective way? CSR Innolabs knew there was room for improvement, so they set out to find an answer.

Luckily, identifying a remedy didn’t require reinventing the wheel. CSR Innolabs instead looked to existing resources, deciding to combine two measurement tools into a stronger one with the potential to facilitate this crucial but highly complex process. In merging “Social Footprint” (a tool developed by the organization Business in the Community), and “Measuring Socio-Economic Impact” (a tool developed by WBCSD, or the World Business Council for Sustainable Development), they found the right mixture, one that paved the way for proper guidelines for identifying, evaluating, and communicating the social impact of projects of the five participating partners.

The result? “The Lifespan of Business’ Social Impact,” a guideline structured around the concept of a tree and its natural growth, in which each component forms an essential cog in the social impact measurement machine. These components are the seeds and roots, grass, trunk, branches, leaves and pollen. If a picture is worth a thousand words, a tree image best summarizes the social impact measurement process and its critical elements.


The results of each case study used to test this methodology were consolidated in the recently released publication “The Keys to Evaluation, Measurement and Social Impact Management in Latin America and the Caribbean,” which is available here. Building off the “tree” guidelines and the case studies that bring it to life, the publication also features recommendations and sparks a constructive and open dialogue around social impact measurement.

Reflecting upon the publication, Bernardo Guillamon, Manager of the IDB’s Office of Outreach and Partnerships, said “the competiveness of companies relies more heavily now than ever before on their ability to understand and communicate their social and environmental footprint.” This statement, and the evidence that backs it, highlights the fact that the measure of a company no longer relies on its profitability or its market capitalization alone. Rather it relies on their ability to engage partners, create shared value, and implement socially responsible management strategies across their organization. Thus, CSR Innolabs’ new guidelines do more than identify gaps, foster communication, and show companies the value of their social responsibility efforts. It also proves just how each of these socially conscious businesses measure up.




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